Navios Maritime Holdings Inc. Reports Financial Results for the Third Quarter and Nine Months ended September 30, 2005title
- Navios Announces Dividend Policy
- Navios doubles size of owned fleet through options exercise
- Navios to expand size of chartered- in fleet
PIRAEUS, Greece, Nov. 28 /PRNewswire-FirstCall/ -- Navios Maritime
Holdings Inc. ("Navios") (Nasdaq: BULK, BULKU, BULKW), a leading vertically
integrated global shipping company specializing in the dry-bulk shipping
industry, today reported its financial results for the third quarter and nine
months ended September 30, 2005.
Ms. Angeliki Frangou, Chairman and CEO of Navios, stated, "Since closing
the acquisition of Navios at the end of the third quarter, we have taken a
number of steps to position the Company for future growth and profitability.
Recently, Navios announced the exercise of purchase options on certain vessels
which will increase Navioss owned fleet to 12 vessels. In addition, Navios
will expand its chartered-in fleet through the favorable charters of two new
Panamaxes and one new Handymax in 2007 and 2008. Overall, I am pleased with
this quarters financial performance, which reflects solid operational
results."
For the following results and the selected financial statement tables
below, Navios has presented combined statement of operations information for
the three and nine months ended September 30, 2005. This information was
derived from the unaudited consolidated statement of operations of the
predecessor business for the period July 1 to August 25, 2005 and for the
period January 1 to August 25, 2005 and from the unaudited consolidated
statement of operations of the successor business for the period August 26 to
September 30, 2005. Navios has prepared this combined statement of
operations information solely to assist comparisons across the three and nine
month financial periods. The successor and predecessor periods in the
combined statement of operations includes the effects of fair value purchase
accounting adjustments. The combined information is a Non-US GAAP financial
measure and should not be used in isolation or substitution of the Predecessor
and Successor results.
Third Quarter 2005 Results:
In 000 Three Months Successor Predecessor Predecessor
Ended September August 26, July 1, 2005 Three Months
30, 2005 2005 To To August Ended
September 25, 2005 September
30, 2005 30, 2004
(Combined
Unaudited) (Unaudited) (Unaudited) (Unaudited)
Revenues $51,758 $20,454 $31,304 $78,211
EBITDA $23,382 $7,923 $15,459 $28,383
Net income $16,763 $2,697 $14,066 $27,320
Revenues for the three months of operations ended September 30, 2005 were
$51.7 million as compared to $78.2 million for the same period during 2004.
EBITDA was $23.4 million for the third quarter 2005 as compared to $28.4
million for the same period of 2004. EBITDA for the quarter ended September
30, 2005 also included a one-time severance payment of $1.4 million to Navios
former CEO in accordance with a change of control provision contained in his
employment contact.
Net income for the quarter was $16.8 million as compared to $27.3 million
for the comparable period of 2004.
The decline in Revenues and Net income was principally attributable to a
reduction in the number of short-term chartered-in vessels operated by the
company during the respective periods as shown in the exhibit under "Fleet
Summary Data". The "Available Days" for the fleet declined 30.7% to 2,075
days for the quarter ended September 30, 2005 as compared to the same period
for 2004. The "Time Charter Equivalent" rate per day, including Forward
Freight Agreements (FFAs), declined 10.1% to $22,055 for the three months
ended September 30, 2005 as compared to the same period for 2004.
As of September 30, 2005, Navios operated a fleet of 21 vessels, of which
6 were owned and 15 were under long-term charters at favorable rates.
Navioss cash and cash equivalents balance as of September 30, 2005 was $133.3
million.
Nine Months 2005 Results:
In 000 Nine Months Successor Predecessor Predecessor
Ended September August 26, Jan. 1, 2005 Nine Months
30, 2005 2005 To To August Ended
September 25, 2005 September
30, 2005 30, 2004
(Combined
Unaudited) (Unaudited) (Unaudited) (Unaudited)
Revenues $179,084 $20,454 $158,630 $216,274
EBITDA $63,915 $7,923 $55,992 $101,561
Net income $54,034 $2,697 $51,337 $95,916
Revenues for the nine months of operations ended September 30, 2005 were
$179.1 million as compared to $216.3 million for the same period during 2004.
EBITDA was $63.9 million for the first nine months 2005 as compared to $101.6
million for the same period of 2004. Net income for the nine months ended
September 30, 2005 was $54.0 million as compared to $95.9 million for the
comparable period of 2004. The first nine months of 2005 were adversely
affected by a number of factors, including (i) a reduction in the number of
short-term chartered vessels operated by Navios as exhibited in the Fleet
Summary Data, (ii) $1.8 million of transaction costs incurred in connection
with the sale of Navios and $1.4 million of one-time severance payments to the
former CEO, and (iii) extraordinary profits in FFA trading in 2004 ($42.5
million).
The "Available Days" for the fleet declined 26.4% to 6,886 days for the
nine months ended September 30, 2005 as compared to the same period for 2004.
The "Time Charter Equivalent" rate per day, including FFAs, declined 8.8% to
$23,421 for the nine months ended September 30, 2005 as compared to the same
period for 2004.
Summary Fleet Data
The following table reflects available days, operating days, fleet
utilization, and TCE rates for the three month period ended September 30, 2005
and 2004.
Three Months Ended Nine Months Ended
September 30, September 30,
2005 2004 2005 2004
(Combined) (Combined)
Available days (1) 2,075 2,996 6,886 9,358
Operating days (2) 2,073 2,993 6,857 9,342
Fleet Utilization (3) 99.9% 99.9 % 99.6 % 99.8 %
Time Charter Equivalent
(TCE)* (4) $ 22,055 $ 24,520 $ 23,421 $25,687
*Including gains and losses from Forward Freight Agreements ("FFAs").
While FFAs are an integral part of our shipping business they are, for
accounting purposes, a distinct activity. TCE rates excluding FFAs were, for
the three months ending September 30, 2005 and 2004, $20,720 and $23,235,
respectively and were, for the nine months ending September 30, 2005 and 2004,
$23,135 and $21,146, respectively.
(1) Available days for fleet are total calendar days the vessels were in
our possession for the relevant period after subtracting off-hire
days associated with major repairs, drydocks or special surveys. The
shipping industry uses available days to measure the number of days
in a relevant period during which vessels should be capable of
generating revenues.
(2) Operating days is the number of available days in the relevant period
less the aggregate number of days that the vessels are off-hire due
to any reason, including unforeseen circumstances. The shipping
industry uses operating days to measure the aggregate number of days
in a relevant period during which vessels actually generate revenues.
(3) Fleet utilization is the percentage of time that our vessels were
available for revenue generating available days, and is determined by
dividing the number of operating days during a relevant period by the
number of available days during that period. The shipping industry
uses fleet utilization to measure a companys efficiency in finding
suitable employment for its vessels.
(4) Time Charter Equivalent, or TCE, are defined as voyage and time
charter revenues plus gains or losses on FFAs less voyage expenses
during a relevant period divided by the number of available days
during the period.
Fleet Employment Profile:
Following is the core fleet employment profile, including new buildings
to be delivered. The core fleet includes the owned vessels and the long
term chartered-in vessels. Navioss core fleet consists of a total of 29
vessels, totaling 1.9 million deadweight tons, including six modern Ultra-
Handymax (52,000-55,000 dwt) vessels which the company owns, 15 Panamax
(70,000-83,000 dwt) and 8 Ultra-Handymax vessels under long-term time charter.
The 21 vessels in current operation aggregate approximately 1.3 million
deadweight tons and have an average age of 3.5 years. Navios has currently
fixed 57.6% of its 2006 available days.
Vessel Type Built DWT Charter Expiration
Rate(1) Date(2)
Owned Vessels:
Navios Achilles Ultra Handymax 2001 52,063 15,400 12/09/2005
Navios Apollon Ultra Handymax 2000 52,073 16,150 08/21/2007
Navios Herakles Ultra Handymax 2001 52,061 29,597 02/01/2006
Navios Hios Ultra Handymax 2003 55,180 19,237 09/15/2006
Navios Ionian Ultra Handymax 2000 52,068 27,693 12/06/2005
Navios Kypros Ultra Handymax 2003 55,222 24,063 04/27/2006
Long Term Chartered-in Vessels:
Navios Arc Ultra Handymax 2003 53,514 17,908 07/15/2006
Navios Horizon Ultra Handymax 2001 50,346 12,588 05/30/2006
Navios Mercator Ultra Handymax 2002 53,400 21,175 10/01/2006
Navios Meridian Ultra Handymax 2002 50,316 20,045 10/15/2006
Navios Vector Ultra Handymax 2002 50,300 8,883 12/17/2007
Linda Oldendorff Panamax 1995 75,100 31,350 01/03/2006
Navios Aurora Panamax 2005 75,200 24,063 05/27/2008
Navios Cielo Panamax 2003 75,834 18,961 03/15/2006
Navios Galaxy Panamax 2001 74,195 24,062 12/25/2007
Navios Hyperion Panamax 2004 75,500 15,400 01/05/2007
Navios Magellan Panamax 2000 74,333 18,763 04/07/2006
Navios Orbiter Panamax 2004 76,000 33,688 12/28/2005
Navios Orion Panamax 2005 76,000 21,175 01/15/2007
Navios Star Panamax 2002 76,662 15,343 01/13/2007
Navios Titan Panamax 2005 82,300 20,000 10/09/2007
Long Term Chartered-in
Vessels to be delivered:
Navios TBN Shoei
(Taiyo) Ultra Handymax 05/2006 53,500
Navios TBN
Kamasarmax Panamax 08/2006 82,800
Navios TBN Toyo
Kaiun Panamax 01/2007 75,500
Navios TBN Shoei Ultra Handymax 04/2007 53,500
Navios TBN
Tsuneishi Panamax 09/2007 82,000
Navios TBN Doun
Kisen Panamax 11/2007 75,200
Navios TBN Shoei Panamax 03/2008 76,500
Navios TBN Doun
Kisen Ultra Handymax 05/2008 55,100
(1) Net Time Charter Rate per day (excludes commissions)
(2) Estimated dates assuming earliest redelivery by charterers
Selected Financial Tables
The results of operations of Navios to August 25, 2005 are labeled as
"Predecessor" and remain as historically reported. The results of operations
from August 26, 2005 forward are labeled as "Successor" and reflect the
operations of Navios subsequent to the acquisition and downstream merger of
International Shipping Enterprises, Inc.
NAVIOS MARITIME HOLDINGS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands of US Dollars)
Successor Predecessor Predecessor
August 26, July 1, Three
2005 2005 Months
To To Ended
Sept. 30, August 25, Sept. 30,
2005 2005 2004
(Unaudited) (Unaudited) (Unaudited)
Revenue $20,454 $31,304 $78,211
Gain (loss) on Forward Freight
Agreements (898) 3,668 3,850
Time charter, voyage and port terminal
expense (10,179) (15,873) (48,177)
Direct vessel expense (858) (1,296) (1,863)
General and administrative expense (866) (3,216) (2,920)
Depreciation and amortization (2,187) (890) (1,503)
Interest income 242 489 286
Interest expense (3,170) (687) (909)
Other income 368 581 115
Other expense (337) (162) (36)
Income before equity in net earnings of
affiliate companies 2,569 13,918 27,054
Equity in net earnings of affiliate
companies 128 148 266
Net income $2,697 $14,066 $27,320
Net income per share:
Basic $0.068 $0.353 $0.685
Diluted $0.054 $0.283 $0.685
NAVIOS MARITIME HOLDINGS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands of US Dollars)
Successor Predecessor Predecessor
August 26, January 1, Nine Months
2005 To To Ended
Sept. 30, August 25, Sept. 30,
2005 2005 2004
(Unaudited) (Unaudited) (Unaudited)
Revenue $20,454 $158,630 $216,274
Gain (loss) on Forward Freight
Agreements (898) 2,869 42,492
Time charter, voyage and port terminal
expense (10,179) (91,806) (141,494)
Direct vessel expense (858) (5,650) (6,118)
General and administrative expense (866) (9,964) (9,300)
Depreciation and amortization (2,187) (3,872) (4,438)
Interest income 242 1,350 486
Interest expense (3,170) (1,677) (2,549)
Other income 368 1,426 482
Other expense (337) (757) (532)
Income before equity in net earnings of
affiliate companies 2,569 50,549 95,303
Equity in net earnings of affiliate
companies 128 788 613
Net income $2,697 $51,337 $95,916
Net income per share:
Basic $0.068 $1.287 $2.404
Diluted $0.054 $1.043 $2.404
NAVIOS MARITIME HOLDINGS INC.
CONSOLIDATED BALANCE SHEETS
(in thousands of US Dollars)
Successor Predecessor
September 30, December 31,
2005 2004
(Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $133,289 $46,758
Restricted cash 4,159 3,513
Accounts receivable - net of allowance for
doubtful accounts of $7 as at September 30,
2005 and $2,291 as at December 31, 2004 13,181 15,200
Short term derivative assets 35,475 109,310
Short term backlog asset 5,246 -
Prepaid voyage costs 5,833 11,120
Prepaid expenses and other current assets 1,876 2,043
Total current assets 199,059 187,944
Vessels, net 194,270 116,231
Port terminal assets, net 26,633 20,973
Other fixed assets, net 894 995
Fixed assets under construction - 2,794
Deposit on exercise of vessel purchase option 1,869 -
Long term derivative assets 2,746 708
Long term backlog asset 9,066 -
Deferred financing costs, net 8,984 425
Deferred dry dock and special survey costs, net 865 435
Investment in affiliates 500 557
Trade name 89,723 2,004
Other fixed operating rights, net 30,924 -
Favorable leases terms 62,770 -
Vessel purchase options 76,010 -
Goodwill 39,429 226
Total noncurrent assets 544,683 145,348
Total Assets $743,742 $333,292
LIABILITIES AND STOCKHOLDERS EQUITY
Current Liabilities:
Accounts payable $8,499 $14,883
Accrued expenses 7,287 7,117
Deferred voyage revenue 9,445 15,135
Short term derivative liability 21,697 65,392
Short term backlog liability 6,052 -
Current portion of long term debt 175,500 1,000
Total current liabilities 228,480 103,527
Long term liabilities 2,544 3,024
Long term derivative liability 2,717 2,444
Long term backlog liability 6,052
Long term debt, net of current portion 317,000 49,506
Total noncurrent liabilities 328,313 54,974
Total liabilities 556,793 158,501
Commitments and Contingencies - -
Stockholders Equity:
Successor:
Preferred Stock - $0.0001 per value,
authorized 1,000,000 shares, none issued
Common Stock - $0.0001 par value,
authorized 20,000,000, issued and
outstanding 39,900,000 4
Additional paid-in capital 184,248
Retained earnings 2,697
Predecessor:
Common Stock, $0.10 par value - authorized,
issued and outstanding, 874,584 shares 87
Additional Paid-in Capital 60,570
Legal Reserve (Restricted) 289
Retained earnings 113,845
Total stockholders equity 186,949 174,791
Total Liabilities and Stockholders Equity $743,742 $333,292
NAVIOS MARITIME HOLDINGS INC.
CONSOLIDATED STATEMENTS OF CASH FLOW
(in thousands of US Dollars)
Successor Predecessor Predecessor
August 26, January 1, January 1,
2005 To 2005 To 2004 To
Sept. 30, August 25, Sept. 30,
2005 2005 2004
(Unaudited) (Unaudited) (Unaudited)
OPERATING ACTIVITIES:
Net income $2,697 $51,337 $95,916
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 2,187 3,872 4,438
Amortization of dry dock 32 160 188
Amortization of deferred financing
cost 159 425 396
Amortization of backlog (80) - -
Provision for losses on accounts
receivable 7 (880) (556)
Unrealized loss on FFA derivatives 8,775 23,793 8,863
Unrealized (gain)/loss on foreign
exchange contracts (120) 338 133
Unrealized (gain)/loss on interest
rate swaps (138) (403) 388
Earnings in affiliates, net of
dividends received (128) 185 86
Changes in operating assets and
liabilities:
(Increase) decrease in restricted
cash 360 (1,005) 61
(Increase) decrease in accounts
receivable (8,267) 11,768 3,228
Decrease in prepaid voyage costs 1,632 3,704 6,441
(Increase) decrease in prepaid
expenses and other assets (6) 58 116
Decrease in accounts payable (6,709) (10,172) (4,105)
Increase (decrease) in accrued
expenses (896) (1,229) 1,124
Decrease in deferred voyage revenue (658) (5,032) (4,819)
Decrease in long term liabilities (28) (451) (475)
Increase (decrease) in derivative
accounts 653 (4,523) 1,243
Net cash provided by operating activities (528) 71,945 112,666
INVESTING ACTIVITIES:
Deposit on exercise of vessel purchase
option (1,869) - -
Deferred drydock and special survey
costs (14) - -
Purchase of property and equipment - (4,264) (3,475)
Cash received from downstream merger 102,259
Net cash used in investing activities 100,376 (4,264) (3,475)
FINANCING ACTIVITIES:
Repayment of long term debt (21,870) (50,506) (4,870)
Acquisition of common stock - - (9,000)
Redemption of preferred stock - - (15,189)
Repayment of stockholder loans (8,622) - -
Net cash used in financing activities (30,492) (50,506) (29,059)
Increase in cash and cash equivalents 69,356 17,175 80,132
Cash and cash equivalents,
beginning of the period 63,933 46,758 26,450
Cash and cash equivalents,
end of period $133,289 $63,933 $106,582
EBITDA
EBITDA represents operating earnings before extraordinary items,
depreciation and amortization, net interest expense, and income taxes, if any.
EBITDA is included because it is used by certain investors to measure a
companys financial performance. EBITDA is not an item recognized by US GAAP
and should not be considered a substitute for net income, cash flow from
operating activities and other operations or cash flow statement data prepared
in accordance with accounting principles generally accepted in the United
States or as a measure of profitability or liquidity. EBITDA is presented to
provide additional information with respect to the Companys ability to
satisfy its obligations including debt service, capital expenditures, and
working capital requirements. While EBITDA is frequently used as a measure of
operating results and the ability to meet debt service requirements, the
definition of EBITDA used here may not be comparable to that used by other
companies due to differences in methods of calculation.
EBITDA Reconciliation to Cash From Operations
Three Months Ended September 30,
(in thousands of US Dollars)
Successor Predecessor Predecessor
August 26, July 1, Three months
2005 To 2005 To Ended
Sept. 30, August 25, Sept. 30,
2005 2005 2004
(Unaudited) (Unaudited) (Unaudited)
Net Cash provide by operating activities (528) 22,298 45,152
Net increase (decrease) in operating
assets 6,281 (14,811) (7,243)
Net increase (decrease) operating
liabilities 7,638 6,664 (128)
Net interest cost 2,928 69 (817)
Provision for losses on accounts
receivable (7) - 353
Unrealized gain (loss) on FFA
derivatives, FECs and Interest rate
swaps (8,517) 1,581 (8,920)
Earnings in affiliates,
net of dividends received 128 (342) (14)
EBITDA $7,923 $15,459 $28,383
Nine Months Ended September 30,
(in thousands of US Dollars)
Successor Predecessor Predecessor
Aug. 26, January 1, Nine months
2005 To 2005 To Ended
Sept. 30, August 25, Sept. 30,
2005 2005 2004
(Unaudited) (Unaudited) (Unaudited)
Net Cash provide by operating activities (528) 71,945 112,666
Net increase (decrease) in operating
assets 6,281 (14,525) (9,846)
Net increase (decrease) operating
liabilities 7,638 21,407 7,032
Net interest cost 2,928 198 623
Provision for losses on accounts
receivable (7) 880 556
Unrealized gain (loss) on FFA
derivatives, FECs and Interest rate
swaps (8,517) (23,728) (9,384)
Earnings in affiliates,
net of dividends received 128 (185) (86)
EBITDA $7,923 $55,992 $101,561
Dividend Policy
Navioss Board of Directors has indicated its intention to declare a
quarterly cash dividend of $0.0666 per common share in respect of the fourth
quarter subject to, among other things, finalizing the financing for vessels
being acquired. Ms Frangou stated "I am pleased that we have announced our
dividend policy - we are mindful of our shareholders need for both a current
return as well as long-term growth which can be achieved by retaining adequate
cash flow to build our core fleet."
About Navios Maritime Holdings Inc.
Navios Maritime Holdings, Inc. is one of the leading global brands in
seaborne dry bulk shipping and is a trusted partner for industrial end users,
shipowners, financial business partners, agents and brokers. As a public
company, Navios is committed to providing best-in-class service to both
customers and business partners. Navios maintains offices in Piraeus, Greece;
South Norwalk, Connecticut; and Montevideo, Uruguay. Navioss stock is listed
on the NASDAQ where it trades under the symbols "BULK," "BULKU," and "BULKW."
Risks and uncertainties are described in reports filed by Navios Maritime
Holdings Inc. with the United States Securities and Exchange Commission.
Safe Harbor
This press release may contain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995 about Navios
Maritime Holdings Inc. (Navios). Forward looking statements are statements
that are not historical facts. Such forward-looking statements, based upon the
current beliefs and expectations of Navioss management, are subject to risks
and uncertainties, which could cause actual results to differ from the forward
looking statements. The information set forth herein should be read in light
of such risks. Navios does not assume any obligation to update the information
contained in this press release.
Public & Investor Relations Contact:
Navios Maritime Holdings Inc.
Investor Relations
212-279-8820
investors@navios.com
